A.O. Smith announced it would sell 81% of its China business to CPE, an alternative asset manager. The firm will retain a 19% share and enter a long-term brand licensing agreement, which allows it to participate in the business’ future growth.
Secular demand for energy-efficient products and a dynamic regulatory environment are likely to increase demand for more-efficient water heaters and boilers. A.O. Smith is in a good position to capitalize on this trend.
A.O. Smith has turned to international markets and new product categories for more growth, but this strategy could dilute its profit margins and economic moat.
|
Metric
|
AOS
|
TT
|
CARR
|
|---|---|---|---|
Price/Earnings (Normalized) | 17.59 | 28.21 | 20.82 |
Price/Book Value | 4.97 | 9.94 | 4.49 |
Price/Sales | 2.38 | 3.96 | 2.02 |
Price/Cash Flow | 14.08 | 23.90 | 16.79 |
|
Metric
|
AOS
|
TT
|
CARR
|
|---|---|---|---|
Quick Ratio | 0.98 | 0.69 | 0.54 |
Current Ratio | 1.64 | 1.12 | 1.00 |
Interest Coverage | 26.30 | 19.03 | −2.32 |
|
Metric
|
AOS
|
TT
|
CARR
|
|---|---|---|---|
Return on Assets (Normalized) | 14.94% | 14.37% | 6.00% |
Return on Equity (Normalized) | 27.90% | 37.70% | 16.94% |
Return on Invested Capital (Normalized) | 22.87% | 25.92% | 9.70% |
|
1-Day Chart
|
Name
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Price
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Morningstar Rating for Stocks
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Capital Allocation
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United States